From the perspective of Penrose's theory of growth of the firms, this paper, first, interprets the rapid growth with diversification by the chaebols as exploitation of growth opportunities and available resources, given the rents associated with the domestic market protection and subsidized loans from the state-controlled banks. Second, taking chaebols as a variant of the controlling minority structure firm, the agency costs of the chaebols are analyzed in terms fo unfair expropriation of other minority shareholders and debt-holders like the banks. For this analysis, the paper examines ownership and finance structures, dividends payments and stock prices, and bnakruptcy cases in chaebols. The paper argues that the chagnes in the external economic conditions since the mid 1980s contributed to increasing costs, and reduced the benefits, of the chaebol type firms, as evidenced by their declining profitability and eventually the 1997 crisis.
Download Info
To download:
If you experience problems downloading a file, check if you have the
proper application to
view it first. Information about this may be contained
in the File-Format links below. In case of further problems read
the IDEAS help
page. Note that these files are not on the IDEAS
site. Please be patient as the files may be large.
Publisher Info
Paper provided by Institute of Economic Research, Seoul National University in its series Working Paper Series with number
no18.
Did you know? You can include your works in the database easily by uploading them on the Munich Personal RePEc Archive (MPRA) if you do not have access to an institutional RePEc archive.